Trump Soho Is Not an Oxymoron

I dutifully work the worksheet, using Room 1505 (a “studio suite” with a partially obstructed view) as my test case, and making the assumption that I’d keep it for myself 100 days a year, renting it out the remaining 265. I go with the optimistic-sounding $900-per-night figure and New York City hotel-occupancy rate for 2006, which was a healthy 85 percent. My gross revenue from the unit would be $202,725 a year. Not bad. As soon as I plug in the charges, fees, and fixed costs, however, that number dwindles to a net income of $76,049.37: a wan 3.9 percent return on an investment of almost $2 million, using the most favorable assumptions.

Seen from the developer’s side, however, the gambit is ingenious. On “my” room, the fees alone put over $40,000 into the hotelier’s pockets—not counting the overhead and operating common charges, which add up to another 60 grand. In other words, if you think of Trump Soho as a hotel, it’s a hotel with rooms that essentially come presold for half a year every year; if you think of it as a condominium, it’s a condominium where each unit can be sold twice.

Ask Trump how the project is doing, and be prepared to hear that everything is splendid, record-setting, yooge. In late March, a Trump representative told me the building was 60 percent sold. The availability papers I obtained, however, show less movement: In November 2007—four months ago—contracts were out on just three out of the 37 units on the list. The same document for the end of February 2008 showed five contracts out, and two of the three units spoken for in November were back on the market.

Still, as befits a high-profile project, the prices have been bumped up once already: 1505, my test unit, was $1,848,000 in November. Now it’s $1,941,000. (Of course, the saleswoman immediately promises to give me 2 percent off.) That’s $2,846 per square foot. When the penthouses get released, their prices will hover around $5,000 per square foot, which promises to trigger a top-down price hike on the rest of the floors.

As her final move in the client’s seduction, Amy had an idling Bentley pick me up and whisk me to the construction site. (“And drop you off anywhere you’d like.” Greenpoint?) The driver, Vlad, was a gruff old Russian with a jailhouse-style Cyrillic V tattooed on the back of his palm. He too worked for the Sapirs.

The Bentley slowly circled the block. Across construction-ravaged Spring Street; down exhaust-choked Varick, where Camrys and Econolines waited their turn at the filthy mouth of the tunnel; east on half-demolished Grand. It was 3 p.m., and the Trump Soho construction workers were leaving their shift. They were eyeing the black, shiny, scarablike luxury sedan with heavy stares.

“I heard one of ours died here,” I said to the Bentley driver, keeping up the Russian-businessman charade for no particular purpose. “Yuri or something.”